Hisense Home Appliances : (1) MAJOR TRANSACTION - SUBSCRIPTION FOR SHARES IN SANDEN HOLDINGS CORPORATION; AND (2) NOTICE OF 2021 SECOND EXTRAORDINARY GENERAL MEETING

CONTENTS

Page

DEFINITIONS

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5

APPENDIX I

- FINANCIAL INFORMATION OF THE GROUP . . . . . . . . . . . .

I-1

APPENDIX II

- FINANCIAL INFORMATION OF THE SANDEN GROUP . . .

II-1

APPENDIX III - UNAUDITED PRO FORMA FINANCIAL INFORMATION

OF THE ENLARGED GROUP . . . . . . . . . . . . . . . . . . . . . . . .

III-1

APPENDIX IV - MANAGEMENT DISCUSSION AND ANALYSIS

OF THE SANDEN GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . .

IV-1

APPENDIX V

- GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . .

V-1

NOTICE OF 2021 SECOND EXTRAORDINARY

GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

EGM-1

"ADR Creditors"

the financial creditors participating in the Turnaround

ADR Proceedings;

"ADR Debts"

the total funded debts owed by Sanden and its

subsidiaries to the ADR Creditors in the amount of

approximately JPY98.25 billion (equivalent to

approximately HK$7.2 billion) if calculated based on

the amount of total funded debts owed by the Sanden

and its subsidiaries which are subject to the Turnaround

ADR Proceedings and using foreign exchange rates as

of December 31, 2020;

"Board"

the board of Directors;

"Business Day"

a day which is not a Saturday, Sunday, or any day on

which banking institutions in Japan or the PRC are

generally authorized or obligated by law or executive

order to close;

"CASBE"

China Accounting Standards for Business Enterprise;

"close associates"

has the meaning ascribed to it under the Listing Rules;

"Closing"

closing of the Subscription;

"Closing Date"

the 5th Business Day immediately after the satisfaction

or, to the extent permitted under the Share Purchase

Agreement, waiver of all conditions precedent set forth

in the Share Purchase Agreement (other than those

conditions that by their nature are to be satisfied at the

Closing, but subject to the satisfaction or, to the extent

permitted under the Share Purchase Agreement, waiver

of all such conditions), unless the Share Purchase

Agreement has been terminated pursuant to its terms or

unless another time or date is agreed to in writing by

the Parties;

"Company"

Hisense Home Appliances Group Co., Ltd., a joint

stock limited company incorporated in the PRC with

limited liability, whose shares are listed on the main

board of the Stock Exchange and the main board of the

Shenzhen Stock Exchange;

"connected person"

has the meaning ascribed to it in the Listing Rules;

DEFINITIONS

"Directors"

the directors of the Company;

"EDINET"

the Electronic Disclosure for Investors' NETwork

System, a public disclosure system for securities

documents in Japan;

"EGM"

the 2021 second extraordinary general meeting of the

Company to be held on Tuesday, 25 May 2021 at 3

p.m. at the conference room of the Company's head

office, No. 8 Ronggang Road, Ronggui Street, Shunde

District, Foshan City, Guangdong Province, the PRC,

for the Shareholders to consider and if thought fit,

approve the Share Purchase Agreement and the

transactions contemplated thereunder;

"Enlarged Group"

the Group and the Sanden Group;

"Group"

the Company and its subsidiaries;

"H Shares"

the overseas listed foreign shares of the Company with

a nominal value of RMB1.00 each which are listed on

the Stock Exchange;

"Independent Third Party"

a person, or in the case of a company, the company or

its ultimate beneficial owner(s), who is independent of

and not connected with the Company and its

subsidiaries and its connected persons and its ultimate

beneficial owner(s) or their respective associate;

"JGAAP"

the accounting principles generally accepted in Japan;

"JGAAS"

the auditing standards generally accepted in Japan;

"Latest Practicable Date"

30 April 2021, being the latest practicable date prior to

the printing of this circular for the purpose of

ascertaining certain information contained this circular;

"Listing Rules"

the Rules Governing the Listing of Securities on the

Stock Exchange;

"Long Stop Date"

31 July 2021;

DEFINITIONS

"Material Adverse Effect"

any event, occurrence, fact, condition or change that is

materially adverse to (i) the assets, properties,

operations, business, or condition (financial or

otherwise) of either Sanden, its affiliate or important

joint ventures invested (but not controlled) by Sanden

individually, or Sanden and its affiliates taken as a

whole, or (ii) the ability of Sanden to consummate the

transactions contemplated by the Share Purchase

Agreement;

"PRC"

the People's Republic of China;

"Remaining ADR Debts"

the remaining debts owed by Sanden and its

subsidiaries to the ADR Creditors after the debt

forgiveness under the Turnaround Plan;

"Sanden"

Sanden Holdings Corporation, a joint stock corporation

organized under the laws of Japan, whose shares are

listed on the First Section of the Tokyo Stock

Exchange;

"Sanden Group"

Sanden and its subsidiaries;

"Share Purchase Agreement"

the Share Purchase Agreement entered into between

Sanden and the Company dated 1 March 2021 in

respect of the Subscription;

"Shareholders"

the shareholders of the Company;

"SPV"

Hisense Japan Automotive Air-Conditioning Systems

Corporation（海信日本汽車空調系統合同會社）, the special

purpose vehicle organized under the laws of Japan

formed by the Company as a directly wholly-owned

subsidiary of the Company's directly wholly-owned

subsidiary Kelon Development Company Limited,

which is also an indirectly wholly-owned subsidiary of

the Company;

"Stock Exchange"

The Stock Exchange of Hong Kong Limited;

"Subscription"

the subscription by the Company for 83,627,000 shares

of common stock of Sanden under the terms and

conditions of the Share Purchase Agreement;

"Subscription Amount"

the consideration for the Subscription Shares;

"Subscription Price"

the subscription price of the Subscription Shares;